Microsoft Debuts Revamped Surface and Surface Pro Tablets

On Monday, September 23, 2013 Microsoft® debuted the Surface 2 and the Surface Pro 2. I like a couple of components about the PR effort on these products:

  1. Nick Wingfield’s article on the New York Times website about these two Microsoft tablets colored the debut as the efforts of an underdog. I came away from a quick read of the article with a notion about Microsoft as a company tenaciously learning from its mistakes, and hard to count out
  2. The feature set of the Surface Pro 2 — Intel® i5 processor, up to 8GBs of RAM, a half a terabyte of flash drive storage and a starter price tag of $899.00 — all add up, for me, into a very formidable competitor to any other tablet on the market, but even Apple’s Airbook!

I’ll be interested to see how the product is covered by Walt Mossberg at AllThingsDigital. If public reception of these new products continues to be somewhat positive, and prominent commentators echo the same points Nick Wingfield expressed in his article, then Microsoft has to benefit. Sales of these products will inevitably have to start benefiting the overall business bottom line, which will certainly be favorable for investors. Of most importance, a revenue base built on hardware from tablets and smart phones (don’t forget the Nokia acquisition) may buttress the balance sheet as they part with the revenues otherwise forthcoming from on premises software sales, now lost to cloud SaaS offers.

The tenacity Nick Wingfield notes in their efforts to succeed in the small, smart, mobile device market with these tablets, leads me to think Microsoft management has posited hardware sales as a critically important component of a complex revenue strategy for the near term future. The objective, I think, will be to fill the gross sales revenue shortfall likely to result from diminishing sales of on premises Office licenses as customers continue to convert over to cloud SaaS alternatives.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2013 All Rights Reserved

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